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What is the total Gross Revenue from the operations listed?
Which member received the highest total Patronage Refund?
What percentage of the total Net Surplus is allocated to the Statutory Fund?
What is the Rate of PR for Credit based on the provided amounts?
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What is the Total Expense for Labor and Other Operating Expenses combined?
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How much was allocated for ISCPR from the Net Surplus after the Statutory Fund?
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What is the Average Rate of PR calculated from the total PRs?
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What is the Rate of ISC based on the allocated amount?
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What is the minimum percentage of net surplus that must be allocated for patronage refund after deducting statutory reserves?
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Which type of cooperative business activity exclusively entitles members to a patronage refund?
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If the rate of patronage refund exceeds twice the rate of interest on share capital, what must the cooperative do?
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What is included in the basis for computing patronage refund for trading/marketing activities?
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Which of the following types of cooperatives requires separate recording of income and expenses per activity?
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Who is entitled to receive patronage refund in health service cooperative activities?
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In the context of cooperatives, net surplus is defined as what?
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What kind of fees in the labor service cooperative contribute to the computation of patronage refund?
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What is the maximum allowable interest on share capital as per the Philippine Cooperative Code of 2008?
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According to the guidelines, what is the minimum percentage of net surplus that must be allocated for patronage refunds?
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What defines a patron in the context of cooperatives according to the guidelines?
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What is the purpose of the General Fund as defined in the guidelines?
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Based on the guidelines, how should patronage refunds be distributed among members?
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What does the term 'net surplus' mean according to the guidelines?
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What is the role of the patronage refund principle as described in the guidelines?
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Which category of cooperatives is excluded from these guidelines?
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What is the first accounting entry to set up a patronage refund for members and non-members?
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Which entry is recorded when unclaimed patronage refund or non-membership occurs?
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What is a potential penalty for failing to comply with the provisions of these guidelines?
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What is the effectivity period stated in the guidelines?
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What sanction can be imposed for willful violation of a lawful order by the Authority?
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What happens if any part of the Memorandum Circular is declared unconstitutional?
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What is the central focus of Section 11 in the guidelines?
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Who is mentioned as the presiding officer in the regular meeting minutes of the CDA Board?
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What happens to the patronage refund of a member patron with paid-up share capital contribution if the by-laws specify it is to be credited to share capital?
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If a member patron has unpaid share capital subscription, what occurs with their patronage refund?
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What condition must be fulfilled before a member patron's overdue obligations can be settled using their patronage refund?
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For non-member patrons, how is patronage refund treated if they do not request to become a member within the specified time?
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What is necessary for a non-member patron to become a member of the cooperative?
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How does a member's share capital impact the treatment of their patronage refund upon voluntary withdrawal or involuntary termination?
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What happens to a non-member patron's refund if they fail to fulfill membership requirements after accumulating enough funds?
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Which of the following statements is true regarding the treatment of patronage refunds for unpaid share capital subscriptions?
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Study Notes
Patronage Refund Guidelines for Cooperatives
- The Cooperative Development Authority (CDA) released Memorandum Circular No. 2019-09, outlining guidelines for allocating and distributing patronage refunds.
- The legal basis for these guidelines is Article 86 of the Philippine Cooperative Code of 2008 and Rule 10, Section 14 of the Revised Implementing Rules and Regulations of RA 9520.
- These guidelines apply to all types and categories of cooperatives except cooperative unions.
- Patronage refund is a principle of equity where members equitably share benefits accruing from the cooperative.
- The net surplus is not identified as profit but considered excess payments from the cooperative and returned to members.
- The allocation process begins after allocating statutory funds and interest on share capital.
- At least 30% of the net surplus, after deducting statutory reserves, must be allocated to patronage refund.
- The rate of patronage refund cannot exceed twice the rate of interest on share capital.
- Cooperatives record sales and receipts transactions separately for members and non-members.
- For multi-purpose cooperatives, separate recording of income and expenses for each business activity is required.
- Patronage refund calculation depends on cooperative business activities as reflected in the Statement of Operation.
- The base for determining the patronage refund and who is entitled depends on the type of cooperative business activities.
- The guidelines provide sample computation for patronage refund for multi-purpose cooperatives and individual patrons based on the type of business activity.
- Patronage refund for member patrons with paid-up shares can be credited to their share capital or paid directly depending on the cooperative's by-laws.
- For member patrons with unpaid share capital subscriptions, the refund is credited to their account until the subscription is fully paid.
- Unpaid obligations of member patrons have a portion of the refund credited to their account until the obligation is satisfied.
- Members that have withdrawn or been involuntarily terminated continue to earn interest on unpaid share capital, interest on share capital, and patronage refund until the amount is fully refunded.
- Patronage refund for non-member patrons is set aside in a general fund and allocated upon request, accompanied with evidence of the amount of patronage.
- Non-members who accumulate enough to become members can do so, depending on the bylaws and their request.
- If non-member patrons have accumulated enough for membership but fail to become members, the accumulated amount is added to the reserve fund or education and training fund, at the cooperative's discretion.
- Unclaimed patronage refund for non-members is credited to the reserve fund or education and training fund after notification to the non-member.
- Accounting entries are outlined for patronage refund for members and non-members, including payment, membership, and unclaimed refunds.
- Failure to comply with these guidelines can result in sanctions—including the non-issuance of the Certificate of Compliance (COC) for the following year and potential dissolution of the cooperative for wilful violations.
- Failure to comply with CDA orders regarding these guidelines is an offense punishable by imprisonment or fines.
- The memorandum circular takes effect fifteen days after publication in the Office of the National Administrative Register/Official Gazette.
- The Board of Administrators approved the memorandum circular on July 15, 2019, during their regular meeting in Glan, Sarangani Province.
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Description
Explore the key concepts of patronage refunds in cooperatives as outlined by the CDA in Memorandum Circular No. 2019-09. Understand the legal foundations and the allocation process of surplus benefits among cooperative members. This quiz focuses on how cooperative members can equitably share the net surplus according to Philippine law.